Neurofibromatosis type 2 (NF2) is an autosomal dominant disorder affecting 1 in 60,000 individuals worldwide, originating from loss of heterozygosity (LOH) of the neurofibromin 2 (NF2) gene. The gene product Merlin is involved in signaling pathways controlling cell proliferation, growth, and survival. Aberrant Merlin inactivation results in multiple nervous system tumors, most prevalently bilateral vestibular schwannomas. It is unclear how different NF2 mutations impact dysregulation of signaling pathways and severity of tumor growth and formation. Studying these aspects of the disease is challenging due to limited availability of tissues and difficulties in culturing of NF2 tumor cells. To address this need, we have developed an induced Schwann cell (iSC) model system for evaluating disease mechanisms and testing potential therapeutic strategies against a genetically diverse NF2 patient population. We optimized previously published protocols using small molecules in order to generate iSCs. The impact of patient specific mutations on NF2 expression as well as fibroblast and SC marker expression was evaluated by immunofluorescence (IF) imaging and qRT-PCR analysis. We found marked differences in NF2 expression levels among patient-derived cell lines with varying mutation types. However, when compared to healthy controls, NF2 expression was drastically decreased in all NF2 iSCs. The level of reduction in NF2 expression was surprising given the presence of a second non-mutated allele that is expected to be functional in non-tumor cells of patients. Notably, expression of mature Schwann cell markers SOX10 and MBP was also significantly lower in all patient iSCs tested compared to healthy controls. The observed differential expression of fibroblast and SC markers in the patient-derived iSCs could indicate defects or delay in maturation or differentiation. Overall our new model system is a promising tool that can aid in studying disease mechanisms as well as the development and testing of therapeutic approaches for treatment of NF2.